In our March 14, 2000 Internet Alert, we discussed the impact of the Distance Sales Directive and other EU Internet directives on e-commerce.
Companies that do not adjust their online contracting procedures in light of the Distance Sales Directives run the risk of; (1) extending the time periods within which EU consumers can withdraw from contracts; and (2) possibly subjecting themselves to civil liability for violating national laws of the various EU Member States. The provisions of the EU Member States' laws implementing the Directive will apply even if a contract purports to be governed by the laws of one of the U.S. states or another non-EU jurisdiction.
The provisions of the Distance Sales Directive apply to contracts between a supplier and a consumer in which the supplier uses of one or more "means of distance communication," as part of an organized distance sales or service offering, including mail, press advertising with order form, catalog, telephone, radio, videotext, e-mail, fax, television and, of course, the Internet.
- information on the identity of the supplier and the geographical address of the supplier's place of business;
- the address to which the consumer may address any complaints;
- information on after-sales services and guaranties;
- the main characteristics of the goods or services;
- the price of the goods or services including all associated costs such as taxes and delivery costs;
- the arrangements for payment, delivery and performance;
- the existence of the consumer's right of withdrawal and the conditions and procedures for exercising such right;
- the cost of using the "means of distance communication," insofar as such costs exceed the normal base Internet access or telecommunication rates;
- the period for which the offer or the price remains valid;
- in the case of contracts for the supply of products or services to be performed repeatedly, the minimum duration of the contract; and
- in case of contracts of unspecified duration or a duration exceeding one year, the conditions for canceling the contract.
This seven-day period begins:
- in the case of goods, from the day the consumer received the confirmation in writing or in another durable medium;
- in the case of services, from the day of forming the contract or from the day the consumer received the confirmation in writing or in another durable medium, if it was provided to the consumer after forming the contract.
If the supplier fails to provide such confirmation to the consumer, this right of withdrawal can last as long as three months.
Where the right of withdrawal has been exercised by the consumer, the supplier is required to reimburse all amounts paid by the consumer, as soon as possible and in any case within 30 days. The only charge that may be made to the consumer because of the exercise of the right of withdrawal is the direct cost of returning the goods to the supplier.